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Bitcoin Has Tipped into a Bear Market, Slipping 23% from January Highs

A stretch of crypto scandals, disappointing policy updates, and one big hack have helped push bitcoin into bear-market territory this week.

The aggressive sell-off has pushed the price of the top token down by as much as 23% from January's record price of $109,350. In 24H, bitcoin once plunged below $82,000. This price is currently maintained at below $85,000.

A 20% decline from the latest peak is the technical definition of a bear market, and the sharp drop marks a major turnaround for an asset that just a month ago was shattering records as it rode a wave of bullish momentum.

FBI Says North Korea Was Responsible for $1.5 Billion ByBit Hack

The Federal Bureau of Investigation said on Wednesday that North Korea was responsible for the theft of approximately $1.5 billion in virtual assets from cryptocurrency exchange ByBit.

The agency said it refers to this specific North Korean malicious cyber activity as "TraderTraitor."

"TraderTraitor actors are proceeding rapidly and have converted some of the stolen assets to bitcoin and other virtual assets dispersed across thousands of addresses on multiple blockchains," it said in a public service announcement.

The FBI said it is expected the assets will be further laundered and eventually converted to fiat currency.

Bitcoin ETFs Are Hit by a Record $1 Billion Outflow in One Day

Investors yanked more than $1 billion from spot Bitcoin exchange-traded funds Tuesday, marking the biggest one-day outflow since the cohort’s debut last January.

Fidelity Wise Origin Bitcoin Fund (ticker FBTC) posted the steepest outflows among these funds, followed by the iShares Bitcoin Trust ETF (IBIT), according to data compiled by Bloomberg. That’s as Bitcoin’s price has been faltering, with investors shunning riskier assets in the face of uncertainty. As a group, the Bitcoin funds shed roughly $2.1 billion over six consecutive days — the longest stretch of outflows since last June.

The world’s largest digital asset has come under pressure this week, with its price sinking to its lowest level since mid-November after hitting an all-time high earlier this year. Other cryptocurrencies also slid, with an index tracking top digital tokens on pace for its largest four-day drop since early August.

Strategy launches Bitcoin Hub in Tysons Corner: ‘a free co-working space’

On Feb. 26, Strategy, formerly known as MicroStrategy, announced the launch of the Strategy Bitcoin Hub in Tysons Corner, Virginia, via an X post.

Strategy, known for its significant bitcoin investments, has expanded its role beyond financial holdings by establishing the Strategy Bitcoin Hub. The hub is designed as a free co-working space, providing a venue for bitcoin enthusiasts to connect, collaborate, and innovate. According to the announcement, the hub offers a workspace, lounge, and gym.

This move aligns with Strategy’s recent activities, including a $1.99 billion Bitcoin (BTC) purchase on Feb. 24, reflecting its commitment to the cryptocurrency ecosystem.

Bitcoin’s Slide Has Traders Hedging Against a Drop to $70,000

With the so-called Trump bump fading across markets, Bitcoin options are showing that investors and traders are hedging against a decline in the cryptocurrency to levels last seen just after election day.

The open interest, or the number of outstanding contracts, for put options with a strike price of $70,000 is the second highest among all contracts expiring on Feb. 28, according to data from Deribit, the largest crypto options exchange. A total of $4.9 billion in open interest is set to expire on Friday.

Bitcoin has tumbled roughly 20% from a record high since Donald Trump’s January inauguration, as his combative stance against allies and geopolitical rivals alike shakes investor confidence, and concerns about elevated inflation linger. The crypto sector was also shook by a record hack of the Bybit exchange last week.

Bitcoin Spot ETF Flow

The overall net outflow of the US Bitcoin spot ETF on Wednesday was $754.53 million. The total net asset value of Bitcoin spot ETFs is $95.16 billion, and the ETF net asset ratio (market value compared to total Bitcoin market value) is 5.69%.

Source: SoSoValue

The Bitcoin spot ETF with the highest net outflow on Feb. 26 was iShares Bitcoin Trust (IBIT), with a net outflow of $418.06 million. Following that was Fidelity Wise Origin Bitcoin Fund (FBTC), with a net outflow of 60.46 million, according to SoSoValue.

Source: SoSoValue